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LIBOR

The LIBOR $candal EXPLAINED The Largest Banking Scandal in History...AGAIN! "This dwarfs by orders of magnitude any financial scam in the history of markets" Andrew Lo, 'liT MiT professor of finance Massachusetts Institute of Technology. YOU Let's start with you. Benefit from OABC HOSPITALS FIRE DEPTS. POLICE DEPTS. PUBLIC SERVICES SCHOOLS LIBRARIES Who are involved with Cities Governments Financial Institutions PENSIONS MUTUAL FUNDS DERIVATIVES That have their money in certain investment vehicles CURRENCIES ADJUŞTABLE RATE MORTGAGES 1.5 202 LIBOR Which are directly tied to the LIBOR THE Benchmark for Interest Rates Worldwide LIBOR's Influence in Comparison 800 TOTAL VALUE OF SECURITIES AND TRILLION LOANS AFFECTED BY LIBOR 69.65 TRILLION 15 TRILLION U.S. GDP 13.64 TRILLION WORLD GDP 2.48 TRILLION 862 BILLION U.S. MORTGAGE DEBT REVOLVING DEBT IN U.S. (Mostly Credit Card Debt) U.K. GDP How LIBOR Rates Are Set Member Banks Representatives of Member Banks LIBOR Rate Calculated by MEMBER BANK INTEREST RATE ESTIMATES ST RATE ESTIMATES MEMBER BANK THOMSON RUETERS INTEREST RATE ESTIMATES INTEREST RATE ESTIMATES e$c MEMBER BANK INTEREST RATE ESTIMATES INTEREST RATE ESTIMATES How it is supposed to work What actually happened INTEREST RATE ESTIMATES Calculated by ESe MEMBER BANK INTEREST RATE ESTIMATES HTEREST RATE EST INTEREST RATE ESTIMATES MEMBER BANK THOMSON RUETERS INTEREST RATE ESTIMATES NTEREST RATE EST. MEMBER BANK INTEREST RATE EST. INTEREST RATE ESTIMATES INTEREST RATE EST. INTEREST RATE ESTIMATES INTEREST RATE ESTIMATES "Give a mana gun and he can rob a bank. Give a man a bank and he can rob the world." During the 2007-2009 Financial Crisis, banks wanted to appear healthy... ...So they communicated with each other and submitted lower than usual borrowing rates to be calculated. (It's similar to lying about your salary on a loan application) Banks were lending money in the open market at lower interest rates and collecting less profit in return. Their clients, the Investment Vehicles, suffered by not getting their share of lending profits as they would in a normal open market that was not rigged. PENSIONS MUTUAL FUNDS DERIVATIVES CURRENCIES ADJUSTABLE RATE MORTGAGES That Pay Out Profits To Cities Governments Financial Institutions Which Are Involved With ABC HOSPITALS FIRE DEPTS. POLICE DEPTS. PUBLIC SERVICES SCHOOLS LIBRARIES That Directly Benefit YOU! * (LOSE) “This is the world's biggest banks stealing money that would otherwise have gone toward textbooks and medicine and housing for ordinary Americans, and turning the cash into sports cars and bonuses for the al- ready rich. It's the equivalent of robbing a charity or a church fund to pay for lap dances." Matt Taibbi, Rolling Stone Magazine Courtesy of AccountingDegree.net %24 ... The LIBOR $candal EXPLAINED The Largest Banking Scandal in History...AGAIN! "This dwarfs by orders of magnitude any financial scam in the history of markets" Andrew Lo, 'liT MiT professor of finance Massachusetts Institute of Technology. YOU Let's start with you. Benefit from OABC HOSPITALS FIRE DEPTS. POLICE DEPTS. PUBLIC SERVICES SCHOOLS LIBRARIES Who are involved with Cities Governments Financial Institutions PENSIONS MUTUAL FUNDS DERIVATIVES That have their money in certain investment vehicles CURRENCIES ADJUŞTABLE RATE MORTGAGES 1.5 202 LIBOR Which are directly tied to the LIBOR THE Benchmark for Interest Rates Worldwide LIBOR's Influence in Comparison 800 TOTAL VALUE OF SECURITIES AND TRILLION LOANS AFFECTED BY LIBOR 69.65 TRILLION 15 TRILLION U.S. GDP 13.64 TRILLION WORLD GDP 2.48 TRILLION 862 BILLION U.S. MORTGAGE DEBT REVOLVING DEBT IN U.S. (Mostly Credit Card Debt) U.K. GDP How LIBOR Rates Are Set Member Banks Representatives of Member Banks LIBOR Rate Calculated by MEMBER BANK INTEREST RATE ESTIMATES ST RATE ESTIMATES MEMBER BANK THOMSON RUETERS INTEREST RATE ESTIMATES INTEREST RATE ESTIMATES e$c MEMBER BANK INTEREST RATE ESTIMATES INTEREST RATE ESTIMATES How it is supposed to work What actually happened INTEREST RATE ESTIMATES Calculated by ESe MEMBER BANK INTEREST RATE ESTIMATES HTEREST RATE EST INTEREST RATE ESTIMATES MEMBER BANK THOMSON RUETERS INTEREST RATE ESTIMATES NTEREST RATE EST. MEMBER BANK INTEREST RATE EST. INTEREST RATE ESTIMATES INTEREST RATE EST. INTEREST RATE ESTIMATES INTEREST RATE ESTIMATES "Give a mana gun and he can rob a bank. Give a man a bank and he can rob the world." During the 2007-2009 Financial Crisis, banks wanted to appear healthy... ...So they communicated with each other and submitted lower than usual borrowing rates to be calculated. (It's similar to lying about your salary on a loan application) Banks were lending money in the open market at lower interest rates and collecting less profit in return. Their clients, the Investment Vehicles, suffered by not getting their share of lending profits as they would in a normal open market that was not rigged. PENSIONS MUTUAL FUNDS DERIVATIVES CURRENCIES ADJUSTABLE RATE MORTGAGES That Pay Out Profits To Cities Governments Financial Institutions Which Are Involved With ABC HOSPITALS FIRE DEPTS. POLICE DEPTS. PUBLIC SERVICES SCHOOLS LIBRARIES That Directly Benefit YOU! * (LOSE) “This is the world's biggest banks stealing money that would otherwise have gone toward textbooks and medicine and housing for ordinary Americans, and turning the cash into sports cars and bonuses for the al- ready rich. It's the equivalent of robbing a charity or a church fund to pay for lap dances." Matt Taibbi, Rolling Stone Magazine Courtesy of AccountingDegree.net %24 ... The LIBOR $candal EXPLAINED The Largest Banking Scandal in History...AGAIN! "This dwarfs by orders of magnitude any financial scam in the history of markets" Andrew Lo, 'liT MiT professor of finance Massachusetts Institute of Technology. YOU Let's start with you. Benefit from OABC HOSPITALS FIRE DEPTS. POLICE DEPTS. PUBLIC SERVICES SCHOOLS LIBRARIES Who are involved with Cities Governments Financial Institutions PENSIONS MUTUAL FUNDS DERIVATIVES That have their money in certain investment vehicles CURRENCIES ADJUŞTABLE RATE MORTGAGES 1.5 202 LIBOR Which are directly tied to the LIBOR THE Benchmark for Interest Rates Worldwide LIBOR's Influence in Comparison 800 TOTAL VALUE OF SECURITIES AND TRILLION LOANS AFFECTED BY LIBOR 69.65 TRILLION 15 TRILLION U.S. GDP 13.64 TRILLION WORLD GDP 2.48 TRILLION 862 BILLION U.S. MORTGAGE DEBT REVOLVING DEBT IN U.S. (Mostly Credit Card Debt) U.K. GDP How LIBOR Rates Are Set Member Banks Representatives of Member Banks LIBOR Rate Calculated by MEMBER BANK INTEREST RATE ESTIMATES ST RATE ESTIMATES MEMBER BANK THOMSON RUETERS INTEREST RATE ESTIMATES INTEREST RATE ESTIMATES e$c MEMBER BANK INTEREST RATE ESTIMATES INTEREST RATE ESTIMATES How it is supposed to work What actually happened INTEREST RATE ESTIMATES Calculated by ESe MEMBER BANK INTEREST RATE ESTIMATES HTEREST RATE EST INTEREST RATE ESTIMATES MEMBER BANK THOMSON RUETERS INTEREST RATE ESTIMATES NTEREST RATE EST. MEMBER BANK INTEREST RATE EST. INTEREST RATE ESTIMATES INTEREST RATE EST. INTEREST RATE ESTIMATES INTEREST RATE ESTIMATES "Give a mana gun and he can rob a bank. Give a man a bank and he can rob the world." During the 2007-2009 Financial Crisis, banks wanted to appear healthy... ...So they communicated with each other and submitted lower than usual borrowing rates to be calculated. (It's similar to lying about your salary on a loan application) Banks were lending money in the open market at lower interest rates and collecting less profit in return. Their clients, the Investment Vehicles, suffered by not getting their share of lending profits as they would in a normal open market that was not rigged. PENSIONS MUTUAL FUNDS DERIVATIVES CURRENCIES ADJUSTABLE RATE MORTGAGES That Pay Out Profits To Cities Governments Financial Institutions Which Are Involved With ABC HOSPITALS FIRE DEPTS. POLICE DEPTS. PUBLIC SERVICES SCHOOLS LIBRARIES That Directly Benefit YOU! * (LOSE) “This is the world's biggest banks stealing money that would otherwise have gone toward textbooks and medicine and housing for ordinary Americans, and turning the cash into sports cars and bonuses for the al- ready rich. It's the equivalent of robbing a charity or a church fund to pay for lap dances." Matt Taibbi, Rolling Stone Magazine Courtesy of AccountingDegree.net %24 ...

LIBOR

shared by Charissanewark on Jul 11
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LIBOR scandal explained for common folks.

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